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"What was the price did Father Christmas's sled cost? Nothing, it was on the house."

This quip is greeted with moans that resonate through a warehouse in London.

We're at a joke-testing meeting with a firm that makes supplies for social events. Its catalogue features Christmas crackers.

The company's founder grins, nearly apologetically at the joke. But the pun has made the cut and will feature in upcoming crackers.

"You measure the gag by the volume of moans and the loudness of the groans at the table," the founder explains.

The key to a good Christmas cracker pun is not the identical as a good joke per se. It is entirely about the setting - in this instance, the communal amusement of the holiday meal with grandparents, kids and potentially friends.

"The goal is for the joke to be a thing that brings the child in harmony with the grandparent," she adds.

The Science Behind Communal Laughter

Gathering to experience shared amusement is not only ancient, scientists argue, it is likely to be older than humanity.

"Therefore when you are laughing with others around the Christmas table you are engaging in what's very likely a really primordial mammalian social sound," explains a neuroscience expert.

Shared laughter, she says, aids in make and maintain social bonds between people.

Researchers have discovered that a lack of such social exchanges can seriously damage both psychological and bodily health.

"Those you converse with, and laugh with, it results in enhanced levels of endorphin release," she continues.

These natural chemicals are the brain's "feel-good compounds" and are produced both to alleviate tension and discomfort and in response to enjoyable experiences, such as chuckling with friends over a truly terrible festive cracker gag.

"You're not just laughing at a foolish pun with a Christmas cracker," she states. "You are actually performing a lot of the truly vital task of making, maintaining the connections you have with the people you love."

Which Happens In the Mind?

But what is actually taking place inside the mind when we hear a gag?

A tremendous amount happens in response to humour, it turns out.

Employing brain scanning technology, a type of neural imager which shows which parts of the brain are more active, scientists have been able to chart the regions that get more blood.

Testing involves scanning the minds of healthy subjects and then exposing them to a collection of humorous words, accompanied by either a non-emotional sound, or recorded laughter.

"In the scanner we got a really interesting activation pattern of neural activity," says the professor.

A joke stimulates not just the areas of the mind responsible for auditory processing and interpreting speech, but also brain areas associated with both planning and initiating movement and those linked to sight and recall.

Combine these elements as a whole, and people hearing a pun have a sophisticated set of neural reactions that underpin the laughter we hear.

The Contagious Power of Chuckles

Researchers found that when a funny word is paired with chuckles there is a greater response in the mind than the identical phrase when accompanied by a neutral sound.

"This activation occurred in parts of the mind that you would employ to contort your expression into a smile or a chuckle," the professor says.

It indicates we are not just responding to humorous words, they are reacting to the laughter that follows them.

Laughter, according to the expert, can be contagious.

So what does this mean for the laughter heard at a Christmas table?

"People laugh harder when you know others," she says, "and you laugh more when you are fond of them or care for them."

When it comes to festive cracker jokes, she says, the positive effect is more likely to be triggered not by the joke itself, but from the response to it.

"It's the laughter. The joke is the dreadful holiday cracker pun, and it's just a pretext to chuckle together."

The Quest for the Perfect Cracker Joke

Is it possible to find the ultimate gag?

Probably not, but that has not prevented experts from trying to.

Years ago, a professor established a research project for the world's funniest joke.

More than tens of thousands of jokes submitted, with ratings provided by 350,000 people globally, he has a better idea than most as to what works and what fails.

The ideal festive cracker pun needs to be brief, he explains.

"They must also need to be poor jokes, puns that cause us to groan," he continues.

The more "awful" the joke, he states the more effective.

"This is because if nobody finds it funny – it's the gag's fault, not yours.

"What's interesting about the Christmas cracker jokes is that none of us considers them humorous.

"That's a shared experience at the table and I think it's wonderful."